HERS – Home Energy & Efficiency Rating Systems

Those of you who may have built or bought a new home in the City of Santa Fe over the last few years may be familiar with the terms ‘HERS Rating’. HERS (Home Energy Rating System) is a tool for measuring the energy performance of a home. 

It has become the standard method across North America for ranking homes in terms of energy efficiency. Much like the MPG (miles per gallon) rating on a car; a HERS rating describes how energy efficient a home will be.  But energy performance is not the only way to quantify a home’s efficiency.

Going From HERS To WERS:

Water efficiency, as we all know, is all too important in this era of ever growing scarcity of water resources.  And homes are a major source of water consumption in any community. Santa Fe is known as one of the most water efficient cities in the country, and it would make sense that the City Different would spawn a Water Efficiency Rating System or WERS!

In fact we have. Thanks to the combined efforts of water efficiency experts from the Santa Fe Area Home Builder’s Association (SFAHBA), Santa Fe Community College and others from The Foundation for Building and Green Building Coalition, the launch of a new WERS tool is imminent. 

SFAHBA’s Green Building Council provided a portion of the seed money needed to design and develop a mathematical model for measuring and scoring a home’s water efficiency performance based on its design.

Developing the WERS Tool:

Major components of the tool include calculating typical water consumption from various plumbing fixtures based on the ‘gallons per minute’ or ‘gallons per flush’ rating of such fixtures, and the household occupancy level. It is a performance based method that allows home owners, architects and builders to prioritize which fixtures are best suited for their personal needs/desires while assuring overall water use reduction is attained. 

The WERS tool also encourages the use of both rainwater and grey water as a source for both outdoor irrigation and INDOOR use (with proper protocols for health and safety).

The local developers of the WERS tool worked extensively with experts from around the country to assure the method would be appropriate across a national platform. Major national players including RESNET (the licensing agent of the HERS Protocol) and major housing developers are taking notice of our efforts, as they look to adopt water efficiency tools by which to rate homes. 

And with the coming 60 day session of our state legislature, efforts to renew and refund the Sustainable Building Tax Credit will likely find broader support with the inclusion of a WERS type provision.

It is likely that national organizations like RESNET will be looking closely at our locally crafted WERS tool as they begin their process of including water conservation in their set of rating tools. This will only further bolster Santa Fe’s reputation as a leader in water conservation nationally, and help to influence law makers here at home for inclusion of water conservation requirements in new policies.

What Every First-Time Custom Homebuyer Needs To Know

If it is your first time looking to buy a custom home, you may not yet fully understand the complexities of such a prospect. Because buying a custom home is unlike any other purchase you will make in your life. 

Think of it less as a product you are buying and consider it for what it is, a personalized experience specifically tailored to meet your unique values, goals and preferences, so that you are able to attain the lifestyle improvements you have worked so hard to afford, and that you deserve.

Hire An Integrated Design-Build Team:

Conscientious contractors, designers and architects have learned that an integrated design-build team can streamline this process by bringing the right experts to the table from day one to value engineer the plans to best suit the owner’s goals and budget.

Our Santa Fe building and design team brought the services of architectural design and construction under one roof, improving the efficiency of the integrated design-build team even more.

Choose A Great Location:

The lot you choose to build on will have dramatic effects on the cost, timeline and feasibility of the project. Invite your realtor into the integrated team right away. A quality realtor will be able to interpret potential issues and constraints present with covenants, Home Owners’ Associations, and/or historic districts affecting you. 

Furthermore, your expert realtor will be able to demonstrate what other comparable properties in your area have recently sold at. This will affect the appraisal of your property, which the banks will use to determine your loan amount. Lower appraisals often result in the need to bring more cash to the table in order to close a construction loan.

Understand All Design & Building Costs, Then Relax:

An experienced and qualified contractor will be able to provide you with detailed descriptions of the scope of work with a fixed fee agreement to build the home.

Luxury details, finishes and fixtures require careful consideration and planning on the part of the design-build team and will have a significant impact on the budget. Experienced and conscientious designers and builders will be able to calculate reasonably accurate “allowances” to cover the costs of specialty items that may not yet be selected when a construction contract is signed. 

Be timely with selections of items like tile, lighting fixtures, plumbing fixtures, and ask for referrals to local showrooms to view and experience your options.

Remember To Communicate:

Your trusted team of building and design experts will be communicating with you regularly, however, they cannot read your mind.  Don’t allow unspoken concerns detract from the design-build experience.  Good supportive communication will increase the trust among the team and enable the best possible results for you.

Designing and building a custom luxury home is, for many, a once in a lifetime experience.  For some it is something they may get to experience only a few times in their life.  Either way, it is an extraordinary experience that, when handled with trust, expertise, and clear constructive communication is rewarding beyond words. 

Pre-Planning Can Make a Building Dream, a Reality

As spring takes hold of us here in Santa Fe, many dream home hopefuls will decide to make the plunge and commit to getting their much anticipated custom home project underway. 

In our experience, there is nothing more valuable than some careful pre-planning to assure that the next steps you make will lead you directly to making that dream a reality while avoiding many common stumbling blocks.

Location – It’s Most Important:

Location, location, location.  We have all heard this before, but it can’t be emphasized enough.  The lot you choose to build on will dictate to a significant degree how easily you will be able to achieve your goals, stay on your budget and hit the timeline you hope for. 

Use a reputable realtor who is very familiar with new home construction when looking at land.  When possible, pre-select a builder who is in alignment with your core values and work with that builder and realtor to select the lot which will yield the greatest benefit to you. 

Covenants, existing easements and setbacks, the Home Owners’ Association requirements, access to existing utilities, and the soil types on site will all have implications for the design, costs and timeline of your project.  Take time to do the due diligence with your builder and realtor to make sure you know what is going to be required of you on that lot.

Then Get Serious About House Design:

Once the limitations of the lot are understood, and you have made the purchase of the land, it’s time to get serious about design.  If you have pre-selected a builder, ask them who they prefer to work with for design. 

Many builders have existing relationships with architects, and better yet, some have in-house design capabilities.  The integrated design-build approach will yield efficiencies in pre-construction costs and shortened timelines, and perhaps most importantly, enable the project team to design to your budget effectively.  We call this “value engineering”. 

Before you even begin design work make sure you and your builder have had a serious conversation about costs, contract structure and a pre-construction timeline. 

Speak The Same Language About Costs:

When getting clear about what costs to expect, be sure you and your builder are speaking the same language.  Misunderstandings in the beginning about what “typical” costs are, and what may be atypical about your project can lead to disappointments and failed projects.  Remember, builders and architects do not have a crystal ball, and nobody, no matter how experienced, can predict any better than 80%-90% accuracy what the real costs of a project will be before the construction blueprints are 100% completed. 

That said, good design-build teams can prepare you very early on with cost expectations within a reasonable margin, and thus keep everyone’s expectations aligned, and the home design on track, so that the final “bid” doesn’t blow you out of the water.

When you have the right team, a clear understanding of what your site will allow, and cost expectations aligned, there is little to nothing that can stop you from making that dream home a reality.

Santa Fe’s Next Level Water Conservation

Santa Fe is considered one of the most forward thinking in the country when it comes to water conservation policy and practice. Many of you may know that the city has had a toilet retrofit program in effect for many years. The purpose of this program is to accommodate new construction and renovations within the Santa Fe limits without adding new burden on the city’s existing water supplies.

How is this possible?

The Santa Fe Toilet Retrofit Program:

The retrofit program acts like a water bank of sorts. Those hoping to acquire a building permit for a new home in Santa Fe or renovation/addition—in which additional plumbing fixtures (i.e. sources of water consumption) are added—acquire the right to do that by purchasing toilet retrofit credits. These credits go to pay for the replacement of older non-conserving toilets with new water conserving fixtures (at no cost to the one’s whose toilets are upgraded).

Who doesn’t want a new, water-conserving toilet installed for free?

The net effect is the water demands of new construction are offset by increasing the efficiency of the existing city plumbing. This program has gained national recognition, with the National Association of Home Builders adopting policy to promote similar programs nationwide. This national effort was inspired directly from the success of our program in little, old Santa Fe.

Still, many argue this is not enough and we must do more to preserve our water resources. Sometimes this sentiment is (in my opinion, mistakenly) substituted with a zero growth/zero development battle cry. But without new construction our city would crumble, decay and become an irrelevant desert outpost, passed over by the innovators, entrepreneurs and forward thinkers on every front.

Smarter Construction Development in Santa Fe, And Everywhere:

Rather than resist development, a sounder approach is to enact smarter development. Development that continues to improve our efficiency, our ability to grow, while preserving our natural resources to the greatest extent possible.

Perhaps the toilet retrofit program is not enough. Perhaps we should go farther to conserve water. Luckily the 2012 version of the Uniform Plumbing Code (UPC) allows for innovative water conservation methods including the use of grey water for outdoor irrigation and the re-use of collected rainwater for not only outdoor applications but indoor uses as well. Flushing toilets (high efficiency ones) with filtered rainwater. What a concept.

This concept has been around for decades and has been practiced all over the world with great success. The City Different has not yet adopted the [entire] 2012 UPC as code, making it nearly impossible for the next generation of water conservation techniques to be employed here.

Adoption of the [full] 2012 UPC would require a simple vote of the City Council, thus making it much, much easier for builders to maximize water efficiency practices in the city limits. Ultimately adoption of the 2012 UPC makes for a future in which the next generation of water conservation is safe, reliable and attainable for average people in the City Different.

Spring Planning for New Construction in Santa Fe

As spring hits Santa Fe, it’s great to see so many of us outside, playing and enjoying the sounds of the birds, the smell of the blossoms and the beauty of longer warmer days. If allergies haven’t stopped you in your tracks, most of us feel revitalized in the spring.

This is also the time when many of us are getting serious about plans for home improvements, landscaping, or building the new home dreamt of for so many years. When preparing to make that leap of faith into your project, remember that pre-construction planning is as important as any other facet of the project. Take time to plan accordingly.

First Step in Project Planning: Find the Right Experts

The first step in any successful project strategy should be to find the experts right for you. The right realtor, designer, architect or contractor is out there in Santa Fe for you. Find those who share your core values and have a proven track record of success in the type of project you envision. Using least cost as a primary decision making tool almost always leads to less than desirable project outcomes. It is far better to rely on quality of character, reputation and experience.

Once you have a trusted professional employed, rely on their experience and leadership to guide you toward success. Working together you will be able to establish realistic expectations with mutually beneficial outcomes regarding costs, quality and timing. Together you should able to identify the key challenges your project will have in store. Reviewing and understanding any covenants, Home Owners’ Association procedures, and city or county ordinances in and around Santa Fe that apply to your project is vital.

Given all this information, your pro should be able to provide you with a step-by-step process and timeline for gaining the necessary approvals and permits. I call this the pre-construction “critical path.”

Second Step: Setting the Right Budget and Filing All the Paperwork

The development of a quality design, detailed construction budget, and the preparation of documents ready for approvals and permits necessarily take time. The design and budgeting process should not be rushed, but also must be handled efficiently so as not to take longer than needed. After all, getting the project completed on time and on budget is the goal, right?

For larger projects, bank financing is almost always a key element along the pre-construction critical path. The bank’s timeline for pre-approval, appraisal and loan closing will dictate to a great degree the details of your pre-construction timeline. Talk to your bank early to understand what they will require of you and your builder, and how long it will take them to process the information.

Remember, new construction that relies on bank financing cannot commence until the loan is closed and the title company has inspected the lot, typically the last step in the process.

Once your well-planned and professionally orchestrated pre-construction process is successfully behind you, you will have the construction process to enjoy. And it will be an enjoyable experience when you have the right team, the right plan and the right expectations up front.

How Climate Change Affects the Way We Approach Building Homes

Although it’s been in the forefront of scientific discussion for decades, it seems only until very recently that the media and the public at large have seriously begun a discussion about climate change.

Riding on the coat tails of the Intergovernmental Panel on Climate Change (IPCC) Fifth Assessment Report this year, the U.S. Government released its own study, recently, drawing acute attention to the problem of climate change as a real and present threat to our health, comfort, food and water security, and national security.

All of this, based on decades of scientific study from around the world, and the actual measured data of rising average temperatures, increasing severity of droughts, wildfires and increasing intensity of storms, leads us to the question…what is next?

Climate Change Unlike Anything Experienced on Earth:

The evidence is clear. Human activity is the largest contributor to a rapidly changing climate. It’s not that the Earth has never experienced climate change before. In fact, the Earth’s climate is constantly changing, and fluctuations in greenhouse gases in the Earth’s atmosphere have occurred repeatedly throughout the eons.

However, what makes this time unique and unprecedented is that one species (that’s us) has developed itself and its society to a point never before seen on Earth. One species has now harnessed sources of ancient energy (in the form of carbon rich coal, oil and gas) to fuel its own expansion and fruition upon the earth.

And to such an extent that all other species, and the climate stability that allowed that diversity of species to evolve, are now faced with a rate of change not known in recent geological history.

Climate Change, Construction & Real Estate:

What does this fact have to do with buildings and real estate? Everything, actually.

When looking at the data, we are faced with the fact that buildings (including our homes) account for the single largest source of greenhouse gas emissions. That is to say, buildings are where we consume the largest amount of energy across our economy. Heating, cooling, lighting, charging, washing, pumping, watching, refrigerating… more energy consumed in our buildings than in transportation, agriculture or industry, respectively.

At the same time, the building sector also provides the largest source of low cost and easily attainable reductions in energy consumption and thus greenhouse gas emissions. In many cases the climate friendly options in our homes are those options that also save us money.

The use of high efficiency boilers for heating, LED lighting, ENERGY STAR appliances, all save us money over the long term, and reduce energy consumption. Reduced energy consumption at home means less fossil fuel combustion at the power plant, and less impact on climate.

Unlike climate change mitigation strategies in other sectors, high performance building options are off the shelf ready, no need for advanced futuristic solutions. Whether via retrofit or by way of new construction, high performance homes have dramatic impact on the long term outlook for climate change. High performance building techniques are the ‘low hanging fruit’ of climate change mitigation.

Adapting Our Homes in Wake of Climate Change

In the last blog, we discussed the critical implications of the construction methods of our homes and buildings on the causes of climate change. The energy consumption of our buildings is the largest single source of greenhouse gas emissions across our economy.

The building sector also provides us the largest source of low cost and easily attainable reductions in energy consumption and thus greenhouse gas emissions with existing technology. In many cases the climate-friendly options for our homes are those options that also save us money over time: improved insulation, high efficiency lighting & heating, or solar technology. No futuristic, yet-to-be-discovered technology needed.

Although saving money while saving the planet is as compelling a reason as any to build and renovate our homes with the best energy performance options available, there is another equally critical function that our homes can do for climate change.

Adaption of Our Homes:

When we think about adaptive strategies in buildings we must first consider what the impacts of climate change are, and will be in the future. Scientists agree that the most likely outcomes of increased carbon pollution to our atmosphere will be increased severity of heat waves, droughts, and wildfires.

Also likely are increasingly powerful storms, including larger rain events, which in Santa Fe and New Mexico means increased likelihood and severity of flash flooding. With changing temperature and moisture conditions comes changes to pest behavior, as we have seen with bark beetle infestations, and increasing difficulties for agriculture as California is experiencing today.

Our homes can easily be designed and constructed to respond to these climatic stresses. And often can be done in ways that add no additional cost in the context of typical new construction costs today.

Examples of Home Adaption for Climate Change:

Examples include proper solar design, where solar gain is optimized to increase the indoor temperature only in winter while fully shading the living space in summer. This coupled with high mass interior walls and floors can create a home that resists the temperature extremes of the exterior climate.

Similarly, fire resistive exterior building materials will reduce our risks to wildfires. Exterior materials such as steel posts and beams, metal siding and roofing and masonry walls can minimize fire danger to the structure. These materials are also pest and water resistant, improving our resilience in the face of flooding.

Water scarcity is already a reality for New Mexicans and in the future it is likely to only become more so. The use of water conserving fixtures is already code in Santa Fe and has become the norm, but the inclusion of rain water catchment and grey water re-use for landscape irrigation will afford us more garden enjoyment and food security without the added stress to our water supply.

Building & Renovating with the Future In Mind:

The ways in which we build and renovate our homes can afford us increased resilience to the impacts of climate instability. Such methods improve our capacity to remain comfortable and protected from the climate effects we are already faced with, as well as the increased impacts still to come.

What to Expect from Our Design-Build Approach in Santa Fe, NM

If this is the first time you have considered building a custom home, the process of designing and building your dream home may feel daunting and can be worrisome if you don’t know what to expect.

As a Design-Build General Contractor in Santa Fe, Palo Santo Designs LLC, provides comprehensive architectural design and construction services tailored to your unique project goals.

The advantage of our design-build approach is that the design process is informed by technical construction knowledge and real-time construction pricing from the field.

Here’s an outline of the design-build approach:

  • Design development of a home
  • Gathering a team of outsourced services: surveying, soil study, structural engineering, storm-water management, energy modeling and landscape architecture
  • Pricing, plans and permit set
  • Selection of finishes and fixtures
  • Design costs discussed and finalized
  • Construction begins

Integrated team approach allows all the key players (owners, designers, contractor, sub-contractors, suppliers, and other consultants) to feed relevant information into the process early on. This allows the project goals to be met most effectively.


The first step in any successful project is Design. Generally our design process can be broken down as follows:

1. Schematic Design and Design Development.

The process of developing the basic floor plan, site orientation and exterior shape that works for you and the site. This is the most specialized aspect of the process and is different and unique onto each project.

For some, this process can be completed very quickly, but for others it can be time intensive depending on the complexity of the site, the covenants or other restrictions and to what extent you know what design is best for you.

Because of our hands-on knowledge of current construction costs, we are able to project a likely construction budget range during this early phase, optimizing the design process from the start to prepare you for the likely financial implications of the design.  In today’s market, an accelerated cost trend makes it harder than ever to be precise about construction costs until the plans are engineered.  However, the preliminary budget projection and basic house plan are suitable for beginning the bank loan process, should you need.

The final construction bid amount is not guaranteed until the final set of plans are engineered and completed. If your project will require preliminary approval from an architectural review committee or Santa Fe’s Historic Review Board, this would be the stage at which we would prepare the presentations necessary for you. Once we have a basic house design to your liking we then move into the technical aspects of the plan.

2. Outsourced Professional Services:

These services represent our ‘best practices’ approach to quality assurance in design. We work closely with professionals contracted by Palo Santo Designs LLC on your behalf including:

  • Surveyor for topographic study and staking the building corners
  • Geotechnical Engineering for soils study, assuring a design which that minimizes shift, settlement or other common problems in soil movement under your foundation.
  • Structural Engineering to assure all structural components and attachments are sound, durable and safe.
  • Civil Engineering to assure all storm-water management conditions are mitigated adequately and compliance with EPA and other regulations are met.
  • Other professional services including Energy Modeling to optimize energy efficiency, landscape architect, or other services as appropriate to your project.

Pricing and Permit Set:

Based on the outcomes of the two previous steps, a nearly complete set of plans suitable for developing a detailed construction cost breakdown will be made. This will include:

  • Cover Page
  • Site Plan
  • Landscaping Plan
  • Floor Plans
  • Exterior Elevations
  • Roof Drainage Plan
  • Building Sections
  • Typical Wall Section
  • Foundation Plan and Details
  • Roof and Floor Framing Plans
  • Window and Door Schedule
  • Electrical/Lighting Plan
  • Mechanical Plan
  • Other Details as necessary

Finishes and Fixtures will be allocated budget allowances at this time, if not yet specified. The outcome of this step will be a comprehensive construction cost proposal and a set of plans ready for permit.

3. Permitting:

Palo Santo Designs will submit all permit application documents on your behalf and steward the approval process through for you. Permit fees will vary based on location, valuation of the construction and size of the home.

4. Specification:

While the parallel paths of permit approval and bank loan processing are underway, we will work closely with you and preferred vendors to assist you in the selection of finishes and fixtures that suit your taste and your budget.

Additional architectural design work may be appropriate at this stage including interior detail elevations of kitchen, baths, master closet and other key features as necessary to facilitate the selection of cabinets, tile, fixtures, countertops, appliances, and other finishes.

Creating the interior ambiance and overall impression of the home is the outcome of this effort, and allows us to finalize a construction contract amount.

5. Design Costs:

The total cost of the design process will vary based on the unique characteristics of your project and often fall in the range of about 6%-10% of the total construction costs.

Example home:

A home with a projected $1,750,000 construction budget may cost approximately $105,000 to design (6%); a home with a $3,000,000 construction budget may cost $240,000 to design (8%).

Remember that design costs are not included in typical square foot construction costs, so when considering the rough square foot pricing in the next section, the design work is always additional to those typical costs.

Contact us and we will provide you with our Updated Pre-Design Budget exercise which is a very useful tool in preparing for the likely costs of your custom home project.  [email protected] 

Step #2: Construction of a Home

Based on our experience building high quality, high performance custom homes in Santa Fe, NM and surrounding areas, we have developed a very good understanding of what typical construction costs are in this region.

Although each project is unique with varying site considerations, and finishes representing the unique taste and aesthetics of each owner, typical construction costs as of 2023 range between $650-$850 per square foot of heated living area.

In each case, a specialized and itemized construction budget will be developed that represents the exact costs of your project, and will vary somewhat from the typical costs shown here. 

Contact us for a detailed analysis of the likely construction costs for your project.  [email protected] or call us at 505-988-7230

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